Magazine article University Business

Flood Zone Finances: Insurance Costs Rising for Coastal Colleges

Magazine article University Business

Flood Zone Finances: Insurance Costs Rising for Coastal Colleges

Article excerpt

An ocean view may make campus tours scenic, but when it comes to flood insurance, coastal institutions will soon face a deluge of bills. Flood insurance subsidies for colleges and universities located in federally-designated flood zones ended on Oct. 1, when the Biggert Waters Act went into effect.

Premiums will increase by 25 percent each year until the "full risk rate" is reached. That rate will include the average claims payout and all administrative expenses. Institutional officials will need to work with insurance brokers to determine what that amount will be and budget accordingly, says Lisa Mets, vice president of Eckerd College in St. Petersburg, Fla.

"The rate of increase is too much too fast and needs to be examined closely," Mets adds.

Insurance premiums, which cover both buildings and the contents within the buildings, currently cost Eckerd $370,000 a year.

Mets is working with Florida legislators to try to slow down the increases. "I am hoping to form a coalition of colleges and universities so we can make our voices heard in Washington," she says. Other proponents of delaying the increases by at least one year include Gov. Bobby Jindall (La.) and bill co-sponsor and former Congresswoman Maxine Waters (Calif.).

Areas along oceans, rivers, streams, and ponds are designated by a zone code that indicates level of flood risk. Buildings in Zone A areas, such as at Eckerd, have the highest risk of flooding, at one percent chance annually. Another shadow of uncertainty is FEMA's plan to release newly drawn flood maps in the near future. This makes it impossible for campus officials to budget for increased rates, Mets says. …

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